Tech issues stage late rebound

CBS.MarketWatch.com

NEW YORK (CBS.MW) -- Technology stocks jerked back into positive territory in late trading Wednesday as software and chip issues mounted a recovery effort for most of the broader tech sector.

The Nasdaq Composite
$compq
rose 106.04 to 3,270.59, climbing out of a hole the index dug for itself as it dipped well below 3,100 in intra-day trading. The rebound, analysts said, still gives little hope for the start of a broad market recovery.

"It often looks like the darkest hour before the dawn, but it may get darker," said Carl.Marker, portfolio manager of the IMS Capital Value Fund, which has a 36 percent weighting in technology. "I think were within 10 percent of the bottom. The last couple of years, we saw a bottom in July or August, so I don't think we've reached it yet."

Internet stocks took a hit early on as a result of weakness in America Online
aol
as its shares fell to their lowest levels in three months in mid-day trading. AOL picked itself up in the afternoon, gaining 2 points to 51 1/2 at the close. The CBOE Internet Index
SPX, -1.54%
also ended the day higher, rising 1.8 percent.

The CBOE Computer Software Index was the big winner, tacking on 6.4 percent -- its largest gain in weeks -- even as Microsoft
MSFT, -1.70%
was doing battle against the Justice Department. Lawyers for the world's largest software maker returned to court Wednesday, as U.S. District Court Judge Thomas Penfield Jackson quizzed the government about its corporate break-up proposal. See full story.

Rambus
RMBS, -1.25%
bolted 17 3/4 to 168 3/8. The company announced that shareholders gave approval for an increase to 500 million shares, clearing the way for its 4-for-1 stock split.

Lexmark International's
lxk
recent woes were exasperated by a downgrade from Bear Stearns to "attractive" from "buy." The stock, which dropped roughly 10 percent Tuesday, dropped 7 1/4 to 65 1/2. It is now off about 50 percent from a 52-week high of 137 5/8 set on Mar. 22.

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